Bitcoin fell against the US dollar initially during trading on Monday but found enough support near the 8300 level to turn around and form a hammer. This obviously is a very bullish sign, but we also have a significant amount of resistance built into the $9000 handle. If we can break above there, the market could go higher but I think it might take a couple of attempts. It is because of this that I am somewhat optimistic, but much more willing to buy above the $9000 level. The alternate scenario is that we break down below the lows of the session, which would be rather negative. If that happens, I would anticipate that bitcoin would unwind down towards the $8000 level, perhaps even lower than that. Rallies that do break above the $9000 handle will more than likely go looking towards the $10,000 level.
Bitcoin markets initially fell against the Japanese yen on Monday as well, reaching towards the ¥920,000 level before bouncing and forming a hammer in this market also. The candle over the weekend is a massive shooting star that touches the ¥1 million level, so I think that it might be difficult to break above the ¥1 million level, but if we do I think the buyers will probably start to push even higher. Ultimately, the market looks as if it is consolidating in general, so I think that we will probably continue to dance around this area, perhaps trying to pick up a bit of momentum in one direction or another. After all, the ¥1 million level is a large, round, psychologically significant figure, and it looks to be “fair value” for the consolidation rectangle that I have laid out on the chart. I expect a lot of choppy back-and-forth movement in this market.
This article provided by NewsEdge.